Hang Seng Index knocked 1.1pc lower, investors eye blue-chip earnings
Hong Kong stocks were knocked lower on Wednesday, tracking losses on Wall Street overnight where the major indices posted their largest single-day decline since the November election of US President Donald Trump.
The Hang Seng Index closed down 1.1 per cent, or 272 points, to 24,320 while the Hang Seng China Enterprises index slipped 1.8 per cent, or 187 points, to 10,457.
Hengan International plunged 4.8 per cent to HK$60 after both Macquarie and Jefferies lowered their target prices for the napkin and diaper producer.
Huaneng Power International, the listed flagship of China’s largest power producer, fell 5.2 per cent to HK$5.45 after it posted its first profit decline in five years on Tuesday.
“The market has been hurt by the losses in the US,” said Kingston Lin King-ham, director of securities brokerage AMTD. “But we don’t need to worry too much [as] there is no change in the fundamentals.”
Lin said the benchmark index may rebound after some of the biggest listed companies release their profit results in the coming days.
A handful of blue-chips managed gains after they reported strong earnings for 2016.
Geely Automobile surged 5.8 per cent to HK$11.98 after it posted a 126 per cent growth in net profits, beating expectations.
The market has been hurt by the losses in the US. But we don’t need to worry too much [as] there is no change in the fundamentals
Henderson Land added 1.2 per cent to HK$48.05, helped by a 29 per cent rise in its underlying profit last year.
Optimism towards corporate earnings helped boost the Hang Seng Index to 19-month highs on the first two days of the week.
Mainland China shares also traded lower on Wednesday. The Shanghai Composite Index closed down 0.5 per cent, or 16 points, at 3,245 while the blue-chip CSI 300 dropped 0.5 per cent, or 16 points, to 3,450.
The Shenzhen Component Index ended down 0.3 per cent, or 33 points, to 10,554, and the Nasdaq-style ChiNext lost 0.6 per cent, or 12 points, to 1,949.
Steel makers and banks led the losses while companies focusing on overseas construction largely rose after China launched an official website for its One Belt, One Road project.
In New York, markets fell sharply overnight with investors concerned about the lack of progress of the Trump administration’s pro-business initiatives.
The Dow Jones Industrial Average closed 1.1 per cent down at 20,668 and the S&P 500 dropped 1.2 per cent to 2,344. The Nasdaq was down 1.8 per cent at 5,794.
Other Asian markets all retreated on Wednesday. Australia’s S&P/ASX 200 closed 1.5 per cent down to 5,685 while South Korea’s Kospi edged down 0.5 per cent to 2,168. Japan’s Nikkei 225 was knocked 2.1 per cent lower at 19,041.
